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Softa [21]
3 years ago
6

Aeryn Soon is a potential investor of Hippy Dippy Inc.’s preferred stock, which is currently selling for $475 per share. Hippy D

ippy pays an annual dividend of $40, and Aeryn’s required return is 8 percent. Should she purchase this preferred stock or NOT? Why?
Business
1 answer:
Ksju [112]3 years ago
5 0

Answer:

Yes she should purchase this preferred stock.

Explanation:

Return on investment as a percentage = return/capital invested * 100

For Aeryn to decide whether she should purchase this preferred stock, its return on investment should be higher than or equal to 8%. The return on investment of this preferred stock is $40/$475 * 100 = 8.42%, which is higher than her required return therefore she should purchase the preferred stock.

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If the Fed engages in an open market sale with a bond dealer, the bond dealer's bank's transactions deposits liabilities will __
Sliva [168]

Answer:

The correct answer is option c.

Explanation:

If the Federal bank sells securities to a bond dealer, the dealer will need to pay back the Fed. This will cause a reduction in the dealer's bank's transaction deposits liabilities.

A reduction in deposits liabilities will further cause a reduction in the total reserves of the bank. Consequently, it will cause a decrease in the money supply. In this way, the federal reserve bank can curb inflationary pressures.

4 0
3 years ago
List three pieces of information listed in a credit card agreement that you believe are important to review before signing up fo
expeople1 [14]

Explanation:

Annual Percentage Rate (APR). This is the cost of borrowing on the card, if you don’t pay the whole balance off each month. You can compare the APR for different cards which will help you to choose the cheapest. You should also compare other things about the cards, for example, fees, charges and incentives

Annual fee. Some cards charge a fee each year for use of the card. The fee is added to the amount due and you will have to pay interest on the fee as well as on your spending, unless you pay it in full.

Minimum repayment. If you don’t pay off the balance each month, you will be asked to repay a minimum amount. This is typically around 3% of the balance due.

3 0
3 years ago
Read 2 more answers
Which criteria would be the ranked most important when an organization is choosing off-the-shelf software
Naddika [18.5K]
The two most important criteria are functionality and ease of installation
4 0
3 years ago
The City of Oxbow General Fund has the following net resources at year-end:
Delvig [45]

Answer:

$1,622,000

Explanation:

Preparation of the fund balance section of the balance sheet.

Partial Balance Sheet-General Fund

As of December 31

FUND BALANCES SECTION OF THE BALANCE SHEET

Nonspendable:

Prepaid Insurance $10,000

Restricted:

Intergovernmental Grants $250,000

Emergency services $26,000

Committed:

Rainy Day Fund $600,000

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Therefore the fund balance section of the balance sheet will be $1,622,000

7 0
3 years ago
Bioplex Corporation has a capital structure of 10% debt, 30% preferred stock, and 60% equity. The firm’s cost of equity is 13%,
vazorg [7]

Answer:

The cost of capital is 10.974%

Explanation:

The capital of a firm is made up of debt and equity component. The weighted average cost of capital or WACC of a firm is the cost of all the firm's capital components combined and can be referred to as simply the cost of capital.

The cost of capital or WACC for Bioplex Corporation is,

WACC = 0.1 * (1-0.21) * 0.06  +  0.3 * 0.09  +  0.6 * 0.13

WACC = 0.10974 or 10.974%

3 0
3 years ago
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